Underlying Euro-Area Price Pressures Are Gradually Recovering
The European Central Bank will leave no stone unturned in its quest to explain the stubborn weakness of inflation -- all that pebble flipping will take about a year. Until the results of its far-reaching strategic review are published, the ECB will remain focused on its preferred gauges of underlying cost pressure. Bloomberg Economics has replicated four of them and sees signs of cost pressure building. But price gains still remain too low -- BE forecasts it will take almost two years for inflation to reach rates that would prompt talk of the ECB withdrawing its stimulus.
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